Capital Economics analyst Nicolas Crittenden says Saudi Arabia's shift back toward a monetary-tightening cycle, a pullback in oil prices and weaker fiscal support will keep the non-oil economy under pressure into next year. Saudi Q3 budget deficit more than doubled q/q to about $22bn. Capital Economics expects oil prices and Saudi government revenues to decline over the coming year as shipping via the Strait of Hormuz normalizes. Crittenden added that public finances that underwrite non-oil acti

Capital Economics analyst Nicolas Crittenden says Saudi Arabia's shift back toward a monetary-tightening cycle, a pullback in oil prices and weaker fiscal support will keep the non-oil economy under pressure into next year. Saudi Q3 budget deficit more than doubled q/q to about $22bn. Capital Economics expects oil prices and Saudi government revenues to decline over the coming year as shipping via the Strait of Hormuz normalizes. Crittenden added that public finances that underwrite non-oil activity are already strained—particularly after an escalation in the Yemen conflict—leaving non-oil firms exposed if fiscal support proves insufficient.